Fairfax reacts to almost $1 billion in catastrophe losses

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Fairfax reacts to almost $1 billion in catastrophe losses | Insurance Business

Fairfax Financial Holdings, the Canadian insurance giant which recently moved for NZ insurer Tower, suffered almost $1 billion in losses in its insurance divisions relating to natural disasters in the last quarter, but still announced net earnings of $476.9 million (all figures $USD) for Q3 2017.

The company, like others with policies in the United States, was hit extremely hard by the trio of devastating hurricanes to hit the US – Harvey, Irma, and Maria.

Prem Watsa, chairman and chief executive officer of Fairfax, told investors and media the results were a reminder of the perilous nature of the insurance business.

“The third quarter of 2017 reminded us yet again that ours is a risk business,” Watsa said on a press conference call.

“During the third quarter of 2017, the insurance industry experienced some of the largest catastrophe losses in its history as a result of Hurricanes Harvey, Irma and Maria and earthquakes in Mexico. Losses for the property and casualty insurance industry from these catastrophes are estimated to be perhaps $100 billion plus. Our companies’ share of the losses amounted to $960 million,” he said.

He added, however, that the $960 million catastrophe loss was “well within our expectation … in a year of extreme catastrophe losses.” He added that “we expect to break even, but will not suffer any significant loss of capital.”